By Eduardo Solamone Rosa
Lawyer at Marcos Martins Advogados
I – INTRODUCTION
Entrepreneurship is a topic that has attracted the attention of scholars for a long time. Its relevance is associated with the potential benefits that entrepreneurial action brings. For example, the emergence of new ventures creates the conditions for continued economic and social development in deprived areas. Within existing organizations, on the other hand, encouraging entrepreneurial action allows them to grow and adapt to the changing conditions of society. Finally, entrepreneurship produces a deep sense of fulfillment in those who undertake it.
In this way, entrepreneurship can be seen as a process that creates individual, organizational and social value.
The history of knowledge about entrepreneurship is not recent. One could even speculate that since the dawn of humanity, organized human action to carry out collective tasks has required the manifestation of entrepreneurs.
Initially considered, in a restricted way, as a phenomenon associated with the creation of companies, entrepreneurship has more recently had its meaning extended to human manifestations aimed at carrying out new organizational projects, either independent or linked to an existing organization.
Currently, there is a proliferation of studies on entrepreneurship that approach the phenomenon in a variety of guises: (i) entrepreneurial individuals; (ii) entrepreneurial teams; (iii) entrepreneurial organizations; and (iv) entrepreneurial societies.
Entrepreneurship, being a human action, is a complex phenomenon that depends on interactions between people and involves the viability and articulation of different types of resources.
In this context, despite the different relationships and interactions that permeate the study of entrepreneurship, the aim of this study is to analyze the communication between Law and Entrepreneurship, but in its purest conception, i.e. the development of the business itself, from the perspective of the lawyer’s work.
II – THE ROLE OF LAWYERS IN ENTREPRENEURSHIP
From the outset of business development, entrepreneurs must consider the need for legal advice. Depending on what the entrepreneur is looking for and how skilled he or she is, this professional can play different roles.
In some cases, legal counsel is only called in periodically to resolve a potential legal issue. In a broader sense, such a professional can provide invaluable help, acting as a real resonating device for both the business and legal issues, occupying a position as a real generator of opportunities.
In the long term, a good lawyer can improve core business issues, providing advice as well as preventing unforeseen liabilities.
Having said that, and regardless of which role they play, the costs of legal advice can be substantial. It is therefore extremely important that the entrepreneur faces the challenge of deciding when and in what situations the presence of a consultancy will be essential, given the financial constraints of the new venture.
When assessing when and how to start looking for a lawyer, the entrepreneur must take into account the financial and administrative costs of finding a lawyer, against the potential benefits for the business, legal advice and production of the necessary documentation.
Building a relationship between entrepreneur and legal advisor is often strengthened if the interaction does not ordinarily involve specific legal issues. It is therefore healthy to keep the legal advisor informed of important business issues, even when their legal implications are apparently insignificant. In this context, the entrepreneur cannot lack the sensitivity to recognize these implications, but perhaps even more important is the opportunity to encourage the active participation of the professional, providing the promotion of an environment in which, in the event of any innovation or advent of a legal position, they can be brought to the attention of the entrepreneur as soon as they occur.
III – THE SELECTION PROCESS
That said, it is important for the entrepreneur to have conversations not just with one legal advisor, but with a number of them, so that they can determine more accurately who might be able to meet their needs, even for business advice.
A compatible working relationship is among the most important factors in finding and choosing a legal advisor. As such, a number of factors play a key role in the entrepreneur’s decision-making process:
Expertise: it is especially important for entrepreneurs, especially in budget constrained scenarios, to ensure that they have experience in advising entrepreneurs and startups, as well as the necessary expertise;
Personality: most entrepreneurs are looking for someone who is a good listener and understands what they want;
Trust: professionals who inspire the possibility of creating a relationship of trust compatible with the business world;
Use of technology: the level of technology in a law firm can make a significant difference to the choice. Having up-to-date software and computer systems that allow them to retrieve, modify and customize files quickly can mean significant cost savings for the entrepreneur;
Punctuality in returning phone calls: often an entrepreneur needs to resolve a legal issue or quickly issue a supported response. The speed with which these calls are returned demonstrates the importance of the entrepreneur. Conversely, the entrepreneur may conclude that their business is not a priority for the professional;
Understanding the business: some entrepreneurs see them as an important source of business acumen and, in some cases, as real mentors or partners. For some entrepreneurs, especially those who don’t have a business partner, it’s important to have someone on hand with whom they can discuss ideas and go over the business plan. In addition, a professional who knows how to visualize and understand the business as a whole and anticipate contingencies can be considered a potential asset;
Networking with potential investors: can serve as a source for establishing contacts with potential investors and venture capital funds. It is advantageous for the entrepreneur to work with a firm that has good relations with entrepreneurship. Lawyers can offer good referrals to other vital contacts for the business, such as bankers, accountants, etc;
Cost sensitivity: having a consultant who understands and has a good sense of the amount of time appropriate for certain issues and their urgency.
IV – CONCLUSION
Understanding the process of creating new ventures requires a willingness to move across different fields of knowledge, a predisposition to integrate approaches and a critical sense to identify the significant contributions of the most different branches of knowledge.
Therefore, the process of choosing a good legal advisor must be accompanied by the same zeal that the entrepreneur has in developing his business.
The legal professional to be chosen must have characteristics that complement the entrepreneur in such a way as to build a relationship of true partnership and mutual understanding, so that the achievement of the objectives set is the subject of positive results for both parties.
V – BIBLIOGRAPHICAL REFERENCES
LENZI, Fernando César; KIESEL, Marcio Daniel; ZUCCO, Fabricia Durieux (Org.). Ação empreendedora: como desenvolver e administrar o seu negócio com excelência. São Paulo: Gente, 2010, 379 p.
SHANE, Scott. Academic entrepreneurship:university spinoffs and wealth creation. Cheltenham: Edward Elgar, 2005, 335 p.
KHANNA, Tarun. Billions of entrepreneurs: how China and India are reshaping their futures and yours. Boston, MA: Harvard Business Press, 2007, 353 p.
